Fresh off dropping $400 million on acquiring song-recognition app Shazam, Apple continued its spending spree on Wednesday, investing $390 million into Finisar, a key company behind the iPhone X's new facial recognition software. Finisar is Apple's second-largest supplier of VCSELs, which are used in several of Apple's new features on the iPhone X, including Portrait mode selfies, Apple said. The first investment was a $200 million infusion into Gorilla Glass maker Corning Inc in May.
As for Apple, the company says it now supports 2 million jobs across all 50 states, including 450,000 jobs that are the result of its spend and investment with US-based suppliers.
Finisar last week said it had started shipping production quantities of the VCSELs. Apple's award will create more than 500 high-skill jobs at the facility.
Depth-sensing technology is a major point of focus right now, by Apple and its competitors.
In the fourth quarter of 2017, Apple will purchase 10 times more VCSEL wafers than were previously manufactured worldwide over a similar time period.
"When you combine our proven ability to consistently manufacture exceptional products with our new Sherman facility, we can achieve our shared goal of providing consumers with incredibly exciting features", said Jerry S Rawls, CEO of Finisar.
Finisar stock jumped on the news. Apple was up 0.7%, near 173.
Piper Jaffray analyst Troy Jensen raised his price target on Finisar to 28 from 22 and reiterated his overweight rating.
Shares of Finisar rival Lumentum Holdings Inc fell 12 percent to $45.80, which Henderson said validates how important 3D sensing technology is to Apple and other vendors. "Up until now, we had assumed Finisar only had 25% of the high-powered VCSEL for the iPhone X and Lumentum had 75% of the high-power and 100% of the low-power VCSEL". Past year alone, Apple spent over $50 billion with more than 9,000 domestic suppliers and manufacturers.
Apple will be buying the entire VCSELs from Finisar Texas.